3 Tips for Newbies in the Market for a Home Loan

Buying a house is an exciting time. A little scary, as well, but a little preparation can help minimize anxiety.

Here are three tips to get you started:

1. Know your credit Good credit counts, so you'll want to make sure your credit report is accurate. Go to annualcreditreport.com and get your credit report from all three of the reporting agencies; you get one free report a year from each.

Report any discrepancies to the appropriate credit reporting agency; they have an obligation to correct it. Do this before you apply for your loan so that you know your credit is accurate.

2. Know what other documents will be useful When you talk with our Home Loan Officers about applying for a home loan, you'll get a list of the specific records you will need to collect to document your income, assets and debts.

3. Know what you can afford Your income and its stability, how much you have for a down payment and your existing debt level are all elements that come into play. Maybe you have heard the 28/36 guideline. This means:

  • * Your total monthly housing commitment - mortgage principal and interest, property taxes, and homeowners insurance - should be no more than 28% of your income before taxes and other deductions.
  • * Your total debt - meaning house payments plus student loans, car loans, and credit cards - should be no more than 36% of your gross monthly income.

These are simply guidelines. Think in terms of what house payment you can handle and still have money for food, utilities, savings, education, childcare, vacations, entertainment, and other priorities.

Have more questions? Talk with one of our loan officers at 877-274-4554 or 360-662-2218.

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